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April 20, 2011

Reinsurer Munich Re expects Q1 loss on Japan



FRANKFURT, Germany (AP) — German reinsurer Munich Re has warned investors it will make a loss in the first quarter because of the earthquake and tsunami in Japan.

Claims from an earthquake in New Zealand and a cyclone in Australia will also contribute to the loss.

CEO Nikolaus von Bomhard said Wednesday that the combined disaster losses were euro2.7 billion ($3.9 billion) for the quarter, or 10 times what the company pays out in an average quarter.

He says Munich Re "will show a loss for the group in the first quarter of 2011," but should make a profit for the full year.

The company, based in Munich, announces its earnings May 9.

Reinsurance companies sell backup insurance to primary insurers so the industry can cover big losses.



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